The valorization of drinking water treatment sludge (DWTS) and eggshell waste represents a promising route for reducing landfill disposal and developing alternative stabilized materials for geotechnical applications. This study aimed to evaluate the mechanical and microstructural behavior of DWTS stabilized with commercial lime (CL) and eggshell-derived hydrated lime (EHL), including alkali-activated EHL systems. EHL was produced from locally collected eggshell waste through washing, drying, grinding, calcination at 1000 °C for 4 h, hydration, drying, and sieving. The mixtures were prepared with lime contents of 5%, 8%, 11%, and 14%, while NaOH solutions of 0.5, 1.0, and 1.5 M were used for the activated systems. A total of 120 cylindrical specimens were compacted under controlled dry unit weight and moisture content and cured for 7 and 28 days. The stabilized DWTS was evaluated through unconfined compressive strength (q_u), SEM–EDS analysis, and multifactorial ANOVA. The highest q_u for CL-treated specimens was 4561.72 kPa at 14% lime and 28 days, while EHL reached its best response at 11% lime and 7 days, with a q_u of 3195.13 kPa. In general, EHL showed a competitive performance at intermediate and high lime contents, although increasing NaOH molarity tended to reduce strength.